THE MONEY MARKET.

Ashburton Guardian, Volume 50, Issue 125, 8 March 1930, Page 8

THE MONEY MARKET.

AUSTRALIAN CONDITIONS. LOWER DIVIDEND BASIS. THE WEEK ON CHANGE, (Written for the "Guardian" by "Investor.") Price movements on the Stock Exchanges of the Dominion may he said to reflect fluctuations in Australia. And from our neighbour there have been rumours—to put it mildly—that "bears" have been at work forcing down prices. Last December a Melbourne paper made some pointed criticism on the same subject. Jobbers had been selling forward, at six weeks delivery, and then doing what they could to depress the market so as to be in a position to buy in at lower prices or, possibly, accept payment of a margin to call the deal oil. The paper stated, however, that speculative selling of bank shares was not legal and was prohibited by the Stock Exchange." The Sydney report during the week mentioned activities by '•bears" in industrials and other classes, and the market is so sensitive that these jobbers should be able to find ample scope for their operations. However, what is tending to depress prices, without any doubt, is the lower dividend basis now generally ruling. In some cases dividends have been passed, and it would not be wise to accept thees announcements without full investigation. At least some of the concerns could have paid the usual dividend: The profits warranted it. But the outlook is so cloudy that the directors decided to strengthen the position- by retaining the profits in the business, and that, in my opinion, was a sound and justifiable step. J lie figures must be studied before the value of the shares can bo judged. But, of course, the majority of the people who want to buy arc guided almost solely by the dividend rate and the return on their investment. It might be as well to bear in mind that a, lower dividend, at times such as tins, does not always imply a weakening. Business of Fair Range. Business on 'Change this week has been of fair range, with the Christchurch turnover easily the largest. In the Government section tax-frees have eased to a: sale of A\ per cent, bonds, 1989, at £9B 10s, and of the inscribeds at £97, 10s and £97 17s Gd. Doubtless the higher interest rate charged by the banks tends to make firms realise on securities yielding so small a return, but the general easing still seems, to me,, to indicate a belief tiiat the year will end with a surplus and that .the possibility of increased taxation will be minimised. For the 5-J per cent, inscribeds the prices paid have been £99 2s 6d and £99 55." Commercials have held their place in the banking group, with early sales at 21s lOd, then an easing to 21s 6d and a recovery to 21s 9d. The prefs. have been turned over i at £6 9s and £6 10s, and that would be all right if the -4 per cent, dividend basis is retained. There have been sales of A.B.C.'s at from 24s 8d to 24s lid with further buyers at 24s lOd. Australasias have been turned oyer at £l2 5s and £l2 3s 6d, but later sellers asked £l2 10s. E.S. and A's have eased this week with sales at £6 10s 6d and £6 7s 6d, and further sellers at the lower figure, which is 5s below the quotation of last Saturday. Both issues of National of Australasia have also eased, but the only business has been in the £5 paids at £7 4s. Unions are firm, with several sales at £l2 and one at £l2 Is.

The few dealings in ISationals of New Zealand have Leen at £G, while New Zealands have bad business at from 57s 4d to 575, with buyers staying in at the lower price. Insurances and Agencies. Operations in the insurance group thus far have been limited to sales of Sew Zealands at 43s 6d, with buyers wanting more at that price. The loan and agency group appears to be standing a lair share of tne adverse influences. Dalgetys have eased to business at £ll 10s and £ll 9s, with more ofi'ered at the lower figure. Cioldsbrough Molts have changed hands at from 3ls 3d to 30s lOd, with sellers at time of writing at 30s lid. New Zealand Guarantees were sold at 8s Id, but have since been in demand at 8s 3d. Shipping can record only one sale, that of Hjuddart Parkers pref. at 20s (id. Woollens have been quite out ot the picture, and the only dealings in coals have been of Westports at 30s and Hikurangis at Is 9d. Buyers moved up to 27s for Grey Valleys, hut sellers asked 28s Del. *

An easing tendency has been apparent in the'brewery group. New Zealands have had sales at from 81s Gd to 80s 9d, and more were ottered at the lower price, a drop of Is 3d for the week. There have been sales of Staples at 48s and 47s 6cl, of Tooths at 3Cs 3d, and Monteiths at 19s 9d. The last mentioned catches the ye in the Exchange Gazette with £25 i2s 6d, set down as the "return on investment on market price." More Interest in Meat Shares. There has been more interest in meat shares, with prices on a lower level. Gears have had several sales at 38s 3d to 37s 9d, while the fully paid issue of New Zealand Bcfrigeratings have been tinned over at 12s. The reduced dividend has brought Dunlops down to business at 17s Gd, with further sellers. Business in British Tobaccos has been limited. There have been sales at from 40s 7-Jd to 41s 3d, with later buyers at 41s Gd. For Colonial Sugars £44 was paid, and for Wilsons Cements 38s 9d and 38s Gd. 31t. Lyells have been to the fore in the mining group. Business went from 32s 9d to 3Js lOd, and then recovered quickly to 33s 2d. Some shrewd investors like the appearance of the metal interests, and consider the shares good buying. The Electrolytic Zinc issues are now ex. div. The prefs. changed hands cum. div. at 27s Bd. and ex. div. ;U 2Gs 9d. Waihis have been sold at 13s Gd, Hahakipawas at and Id, and Winding Creek* Gd and 7d.